Talks between city, MCV, productive, officials say

Published 7:00 pm, Monday, December 24, 2007

The heads of the City of Midland and its biggest taxpayer have talked over a dispute several times in the last year and, although issues remain, both characterize talks as productive.

The city and the Midland Cogeneration Venture have been at odds since 1997 over various aspects of the power plant's value and, as a result, the amount of taxes it should pay. In July, the two sides agreed to end tax appeals for years 1997-2000, although there remain some issues from those years that have not been resolved. The city agreed not to appeal the most recent decision on the MCV's tax appeals for those years, and the MCV agreed to donate a portion of the refund to account for some of the interest owed by schools, which are facing tough economic times.

The two sides exchanged appraisals for a second case, which will cover the years 2001 and forward.

At a recent Midland Area Chamber of Commerce luncheon, City Manager Jon Lynch said he wouldn't characterize the talks as formal negotiations. "But we continue to discuss how things happen and that's how we got the first four years put to bed," Lynch said. He added that both sides are interested in settling.

Gary Pasek, MCV vice president and general legal counsel, said there have been several meetings dating to September 2006. At this point, the two people at the table are Lynch and MCV President and CEO Rodney Boulanger, Pasek said.

"MCV believes that it is in discussions to reach a settlement with the City of Midland," Pasek said.

Keating said The Michigan Tax Tribunal, which is hearing both cases, ordered both sides' appraisals be sealed because they necessarily would have to contain financial information that is subject to privacy. The tax tribunal is scheduled to begin hearing the case next July 7. Keating said the tribunal could decide what, if anything, is to remain sealed, or for how long, at a prehearing conference set to start June 16. Or it could make a ruling earlier.

Former MCV President and CEO James Kevra and former City Manager Karl Tomion had negotiated in the first case, Pasek pointed out. But since Lynch became city manager, "we've had far more frequent discussions," Pasek said.

"The talks themselves are very amicable," Pasek said. "We haven't had a definitive proposal from the city, so until we have one we don't know how close together or far apart we are."